Field of the Invention
The present invention generally relates to a field of assessing and determining a validity of a commercial transaction, particularly a purchase transaction.
Related Art
In a credit-based society nowadays, more and more commercial transactions, even in the area of small daily economic activities of the public, are being conducted without using any cash, aiming for a totally cashless society. As the usage of non-cash payment instrument such as credit cards, debit cards, cyber money, or personal checks comes to infiltrate virtually every area in commercial transactions, it is gaining an increased importance to develop a business scheme that makes commercial transactions, such as payment for purchase, easier, faster, and more convenient to both buyers and merchants, while ensuring the security of the transaction against all kinds of frauds that are also becoming more sophisticated and diversified by taking advantage of rapidly developing modem technologies and potential loopholes existing in the business transaction systems.
For making the everyday commercial transaction easier and convenient in that regard, a number of service providers or payment providers, such as PayPal, Inc. of San Jose, Calif., have emerged and been growing up rapidly these days. One of the business schemes developed recently by such payment providers, for instance, PayPal Here™, to facilitate payment transaction allows a merchant who has an account with such a payment provider to accept payments in non-cash forms, such as a credit card or debit card, by using the merchant's mobile phone in which the payment provider's application is installed as a cash register. Generally, there are two ways of processing, for instance, a credit card payment. One way is to use a portable card reader, typically provided from a service provider, which can be easily plugged in to the merchant's mobile phone. When the merchant swipes a credit card received from a buyer into the card reader, the credit card information is transmitted to the payment provider, which instantly checks the validity of the card, processes, if the validity of the card is confirmed, the payment of a charged amount to the merchant's account minus a contracted service fee, and notifies the result, either acceptance or rejection of the credit card payment, to the merchant's mobile phone.
Another way is to use a camera or scanning function typically carried by a mobile phone these days. This method is used typically in a situation where the card reader described above is not available or fails to work for some reason. In this case, the credit card is photographed or scanned by the mobile phone, and the photo or scanned image of the card carrying the credit card information is transmitted to the payment provider for verification. After payment transaction, the photo or scanned image is routinely stored in the merchant's mobile phone for record. This method, however, is vulnerable to a fraud. The mobile phone is frequently lost or stolen. Someone, who unrightfully acquires the merchant's mobile phone and finds all the photos or scanned images stored therein, may disguise as a genuine merchant by setting up her or his own account with the payment provider, and transmit the photos or scanned images, requesting the payment provider to process payment for a bogus purchase transaction. In this situation, the current method of determining the validity of the transaction, which is based only on the transmitted photos or scanned images of a credit card, cannot detect such a fraudulent request.
Therefore, when a merchant uses a payment provider for verifying and processing a non-cash payment instrument from buyers, such as a credit card, via a merchant device, and when the images of the non-cash payment instrument are taken and sent to the payment provider for verification of the validity of the purchase transaction, a need exists to provide a method and system that has an additional measure for checking the validity of the purchase transaction, in addition to the present way of relying solely on the transmitted images of the non-cash payment instrument, which is, as described above, vulnerable to a fraud.